Is the Consumer Electronics Show Doomed?

We'll be in Las Vegas next week for the 2012 Consumer Electronics Show (CES), where the biggest tech companies are ready to roll out their 2012 product lines. However, PM senior technology editor Glenn Derene writes, with the accelerating pace of gadget reveals and companies increasingly holding their own events throughout the year, humongous tech gatherings like CES could be on the wane.

The Consumer Electronics Show is a very big event. Sure, attendance seems to drop off a bit in response to recessions, but for the past 10 years, CES has drawn between 100,000 and 157,000 people to Las Vegas, and PM will be there next week for CES 2012. (Here's our list of what to expect from this year's show.)

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The show started on the other side of the country in the summer of 1967, with around 100 or so exhibitors and 17,500 attendees crowding into the Hilton and Americana hotels in New York, and the focus was on home audio equipment and televisions. CES has introduced multiple legendary products, including the VCR (1970), CD player (1981), DVD player (1996), HDTV (1998), and plasma TV (2001). Early on, the show was a twice-a-year event, but it eventually settled into a single show in Las Vegas in January to showcase the upcoming year's products. Also, the focus has shifted significantly toward digital gadgets, both as a consequence of the rise of digital home electronics and of the implosion of the COMDEX computer show in the early 2000s. For most of the last decade, then, CES has been a must-attend event for most of the tech world, with companies such as Sony, Microsoft, Intel, and Samsung making splashy introductions of each year's new product lines.

Yet, as CES has gained momentum, there have also been some powerful forces building that will ultimately be its undoing. Indeed, these trends point to trouble for trade shows in general. The current leader in the tech world noticed this early on: Apple has never participated in CES in a meaningful way, initially preferring to headline Macworld, a trade show dedicated to all things Apple, then abandoning even that show in 2009. Now the company hosts all of its own events. Many companies now follow that model—planning their own events to create buzz for significant product launches. Yet many of these companies continue to come to CES out of pure inertia—they come because they feel they must.

Not anymore. Last December, Microsoft corporate VP for communications Frank Shaw wrote on the company blog that, after this year, Microsoft would no longer have keynotes or booths at CES. Why? Because the idea of a yearly product cycle is an anachronism. Modern technology moves much faster than that now, and so does the media that covers it. (Although it's worth noting that some companies have historically had the opposite problem—they unveil a complex product in development as a half-baked prototype at CES well before it's ready.) The news of a cool new gadget can now saturate the Internet before the press event promoting it has even ended. Sometimes, the news breaks before the event even begins. I personally learned about the $199 price of Amazon's Kindle Fire from a Twitter post while sitting in the audience waiting for CEO Jeff Bezos to take the stage at the announcement event.

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CES

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[The Winter Consumer Electronics Show back in 1980. Courtesy CES.]

What's more, the very volume of new products at CES makes it a terrible place to stage an introduction in the first place. Sure, your cool widget is bound to get covered by somebody, but plenty of significant innovations get drowned out by the chaos of the show. If the purpose of a splashy announcement is to get people's attention, it's best to have their full attention.

In fact, this has become a general problem with trade shows—everybody shows up because they feel they have to, but the most innovative companies aren't saving up their big product announcements for somebody else's party anyway. Car shows are still a notable exception, since there are multiple shows throughout the year, such as next week's big North American International Auto Show in Detroit, that allow for a rolling series of new car unveilings. But power tool makers, fancy food purveyors, and other manufacturers of the stuff we love and want to know more about are aware that there are far easier ways to get the word out.

Does this mean that the Consumer Electronics Show is dead? Yes, at least in its current form as a behemoth media event. But there are good reasons for it (or something like it) to linger on in a vastly diminished show. Companies such as Microsoft, Apple, Intel, Google, and Facebook have unique and interesting products that allow those brands to easily manufacture their own buzz. But there are other big electronics companies such as Sony, Samsung, LG, Pioneer, Panasonic, and Sharp that produce huge product lines of commodity products like TVs, laptops, and stereos, that benefit from a wide stage that a trade show provides. Where else can you spread out 30 TVs and parade people by them? (There is, of course, a larger business question about the wisdom of producing large and confusing product lines, but that's for another article.)

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If innovative companies leave and take their big announcements with them, then far fewer people are going to show up, and the public at large will probably not pay as much attention. But these shows were not originally intended to be big, public brouhahas. The original CES had 17,500 attendees (a fraction of the current crowd), almost all of whom were in the electronics trade—because, after all, it was a trade show.

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